GRIM UK retail sales figures for October have prompted a warning that the sector will have “cause for concern” ahead of the crucial festive trading period.
The value of UK retail sales in October was up just 0.2 per cent on the same month of last year, industry figures published today show. This marks a sharp deceleration from year-on-year growth of 2.3 per cent in September. And it is the weakest year-on-year increase since May in the monthly figures, which are published by the British Retail Consortium.
The BRC’s figures signal the value of non-food sales was particularly weak in October. Food sales value was boosted by inflation. Non-food sales tend to reflect more discretionary consumer spending.
Year-on-year growth in retail sales value over the latest 12 months has averaged 1.5 per cent, the BRC notes.
BRC chief executive Helen Dickinson said: “It was a meagre month in October for retail sales as shopping activity slumped. With total growth at its lowest since May and below the 12-month average, retailers will have cause for concern as they prepare for the crucial run-up to Christmas.”
Households have been hit by a renewed fall in real wages. Annual UK consumer prices index inflation has surged on the back of sterling’s post-Brexit vote woes. Nominal pay settlements have been weak amid poor economic growth and fragile business and consumer confidence ahead of the planned European Union exit.
The Bank of England last week raised UK base rates from their record low of 0.25 per cent to 0.5 per cent.
Ms Dickinson said: “Real consumer spending power has been on a downward trend in the last year as the acceleration in inflation has caused shoppers to become ever-more cautious in considering what purchases they can afford. Many now face higher borrowing costs, which will...heap further pressure on to household finances.”
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